Hydrogen Buses Market Size, Share & Trends Analysis Report By Technology (Proton Exchange Membrane Fuel Cells, Direct Methanol Fuel Cells, Phosphoric Acid Fuel Cells, Zinc-Air Fuel Cells, Solid Oxide Fuel Cells), By Power Output (<150 kW, 150–250 kW, >250 kW), By Transit Bus Models (30-Foot Transit Buses, 40-Foot Transit Buses, 60-Foot Transit Buses) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2023-2031

Market Overview

The global hydrogen buses market size was valued at USD 7.3 billion in 2022 and is projected to reach USD 347.4 billion by 2031, registering a CAGR of 47.6% during the forecast period (2023-2031).

Hydrogen buses are public buses that operate on hydrogen fuel cells rather than conventional hydrocarbon fuels. They are acquiring popularity due to their capacity to provide a viable, clean, and efficient public transportation option. The electric motor on these buses is powered by a fuel cell stack that converts hydrogen and oxygen into energy to operate the electric motor. Since the only byproduct of this process is water vapor, hydrogen buses are an option for zero-emission vehicles.

The global hydrogen buses market share is expanding swiftly, propelled by the increasing demand for pure and sustainable transportation solutions worldwide. Globally, governments are implementing programs and incentives to reduce greenhouse gas emissions and enhance air quality, thereby contributing to the expansion of the market. Zero pollutants or greenhouse gases are emitted by hydrogen buses during operation, making them an attractive option for transit agencies and governments seeking to reduce their carbon footprint. Countries such as Germany, the United Kingdom, Japan, South Korea, and China are investing in hydrogen bus fleets, with the Europe and Asia-Pacific region being a significant market for hydrogen buses due to substantial investments in hydrogen fuel cell technology and infrastructure.

Top 4 Key Highlights

• Proton Exchange Membrane Fuel Cells hold the major share in the market based on technology.
• Based on power output, <150kw is the highest contributor to the market.
• 30-foot transit buses generate the greatest market revenue by transit bus models.
• Europe is the highest revenue holder in the market by region.

Market Dynamics

Global Hydrogen Buses Market Drivers

Growing Demand for Clean Energy Solutions

The hydrogen buses market growth is attributed to the growing need for clean energy solutions; due to their potential to reduce emissions and promote clean mobility, hydrogen buses have gained popularity as countries and cities transition to more sustainable and environmentally favorable transportation options. To address environmental concerns and meet climate objectives, Germany has been at the forefront of employing renewable energy solutions, such as hydrogen fuel cell buses. In 2020, the German government will invest substantially to support the nationwide deployment of hydrogen-powered buses. In addition, Jitendra Singh, the union minister, unveiled "India's first indigenously developed hydrogen fuel cell bus" in Pune on Sunday. The Council of Scientific and Industrial Research (CSIR) and private firm KPIT Limited developed the bus. Prime Minister Modi is developing a hydrogen vision for India to ensure that AtmaNirbhar entails affordable and accessible renewable energy, achieving climate change objectives, and creating new entrepreneurs and employment. In addition, green hydrogen is an excellent renewable energy source that enables the thorough decarbonization of emissions from the refining, fertilizer, steel, cement, and heavy transportation sectors that are difficult to mitigate.

Global Hydrogen Buses Market Restraints

High Initial Cost

The high initial costs of fuel cell technology and the infrastructure required for hydrogen production, storage, and replenishment present a substantial barrier for many transit agencies and operators. The London Hydrogen Bus Project was initiated in 2010 to incorporate hydrogen fuel cell buses into the city's public transportation fleet. However, one of the greatest obstacles encountered during the endeavor was the high initial cost of hydrogen buses. Hydrogen fuel cell buses were more expensive to acquire and operate than conventional diesel buses. Typical initial costs for a hydrogen fuel cell bus in 2022 range between USD 1.5 million and USD 2 million.

In contrast, a conventional diesel bus is typically between USD 500,000 and USD 600,000. Establishing the infrastructure for hydrogen refueling requires significant investment in addition to the price of the bus. According to a report by the Fuel Cells and Hydrogen Joint Undertaking (FCH JU), installing a single hydrogen refueling station can cost millions of dollars.

Global Hydrogen Buses Market Opportunities

Growing Tourism Industry

The expanding tourism industry presents significant opportunities for the market, particularly in popular tourist destinations and densely populated cities. Hydrogen buses provide a sustainable and environmentally favorable mode of transportation for visitors, in line with the growing emphasis on sustainable tourism practices. As part of its sustainable transportation initiatives, the popular tourist destination of Barcelona, Spain, has adopted hydrogen buses. The city added hydrogen fuel cell buses to its public transportation fleet, providing travelers and residents a clean and quiet way to explore the city's famous landmarks, cultural attractions, and scenic views. According to the World Travel and Tourism Council (WTTC), tourism accounted for 11.1% of Spain's gross domestic product in 2022. This is a substantial increase from the 10.4% contribution made in 2019. Incorporating hydrogen buses into the transportation network of tourist cities provides visitors with a pure and sustainable mode of transportation. It demonstrates the city's commitment to reducing its carbon footprint and promoting environmentally responsible tourism. As the global tourism industry expands, hydrogen buses provide a means for cities to meet the transportation needs of a growing tourist population while contributing to a greener and more sustainable tourism experience.

Regional Analysis

The global hydrogen bus market research is analyzed in North America, Europe, Asia-Pacific, the Middle East and Africa, and Latin America.

Europe is the largest contributor to the market and is expected to grow at a CAGR of 52.7% during the forecast period. Europe is expected to gain a preeminent share of the hydrogen bus market over the forecast period. One of the primary factors contributing to the market's rise is the significant number of prominent hydrogen-powered bus manufacturers. Furthermore, greater awareness of the availability of the most modern electric vehicle technologies and the growing acceptability of passenger hydrogen automobiles in the European region are propelling the market development of hydrogen buses. Germany is likely to establish its importance in the field of hydrogen buses and emerge as a key market on a worldwide scale throughout the estimated period. Ebusco has delivered its first 90 Ebusco buses to Germany's largest public transportation operator, marking a watershed moment for the company. Other industry participants are expected to follow suit, allowing firms to extend their climate-neutral service offerings across longer distances.

Asia-Pacific is predicted to grow the fastest at a CAGR of 50.89% during the projected period. Rapid population growth, rising passenger bus demand, and rising manufacturing scale are driving hydrogen bus market growth in the region. India's hydrogen bus market is driven by government efforts to achieve its "Hydrogen Vision" of self-sufficiency by meeting weather change objectives, creating employment in the industry, and increasing sustainable energy consumption. The Union Minister of State for Science and Technology revealed India's first indigenous hydrogen fuel cell bus in Pune in August 2022. The Indian hydrogen bus industry will grow as demand for ecologically friendly transportation rises. China will build 1,742 hydrogen fuel cell vehicles in 2021, up 48.2% from 2020, according to CAAM. 1,586 of these automobiles were sold that year, up 34.7%. The reliability, speed of hydrogen refueling, and long-distance operating ability of hydrogen fuel cell buses in China are driving demand.

North American communities will have scalable, clean, and sustainable transportation options through a four-pillar strategy encompassing buses and coaches, technology, infrastructure, and workforce development. The government is working on numerous initiatives to address environmental concerns; for example, the state of California in the United States has committed funding to create 100 hydrogen refueling stations to fulfill its objective of 1.5 million zero-emission automobiles by 2025, which aids growth. The VIC is NFI's first and only innovation lab dedicated to promoting bus and coach technologies and enabling workforce development. Nova Bus debuted its new 100 percent electric, long-range twin-charging bus to the North American market at the New York Public Transit Association convention in Albany, N.Y.

Hydrogen technology and transportation solutions will be critical in shifting to a cleaner, more sustainable future, boosting the Middle East and Africa's Green Economy ambition. The region's government is making significant efforts to reduce greenhouse gas emissions, reduce the usage of fossil fuels, and decarbonize transportation. The National Agenda, which supports the UAE Vision 2021, focuses on improving air quality, conserving water resources, boosting the contribution of renewable energy, and executing green growth strategies. As a result, to demonstrate Dubai's commitment to transitioning to a green economy, the leadership launched the Green Hydrogen initiative at the Mohammed bin Rashid Al Maktoum Solar Park, a first-of-its-kind initiative in the MEA region aimed at producing eco-friendly hydrogen using renewable energy.

Segmental Analysis

The global hydrogen buses market is segmented based on technology, power output and transit bus models.

Technology is further segmented into Proton Exchange Membrane Fuel Cells, Direct Methanol Fuel Cells, Phosphoric Acid Fuel Cells, Zinc-Air Fuel Cells, and Solid Oxide Fuel Cells.

Proton Exchange Membrane Fuel Cells hold the major share in the market. Proton Exchange Membrane Fuel Cells (PEMFCs) are the most frequent fuel cell used in hydrogen buses due to their high efficiency, low operating temperature, and quick start-up characteristics. They work by transporting hydrogen gas across a proton exchange membrane, where the hydrogen ions interact with oxygen from the air to create electricity. PEMFCs are excellent for various applications, including transportation, due to their small size and ability to offer a constant power output.

DMFCs use liquid methanol fuel, which is easier to store and carry than gaseous hydrogen. DMFCs work at a lower temperature, making them appropriate for portable and small-scale applications. However, their poorer efficiency and higher methanol consumption have limited their application in bigger hydrogen buses.

Power output can further bifurcate the segment into <150kw, 150-250kw, and>250kw.

<150kw is the highest contributor to the market. Hydrogen buses with less than 150kW of electricity are ideal for smaller-scale operations and urban locations. These buses are commonly used in city centers, shuttle services, or shorter intra-city routes with reduced passenger capacity demands. Because of their small size and reduced power output, they are easily maneuverable on congested city streets, allowing for smooth navigation through traffic and tight bends. Hydrogen buses with power outputs ranging from 150kW to 250kW are classified as medium-sized vehicles, providing a versatile option for various transportation needs. These buses achieve a good mix of power, passenger capacity, and range, making them suited for a wider range of applications. They are extensively used in urban and suburban regions and on intercity routes with greater lengths.

30-Foot Transit Buses, 40-Foot Transit Buses, and 60-Foot Buses are the sub-segments based on transit models.

30-foot transit buses generate the greatest market revenue. Hydrogen buses of the 30-foot range are small and maneuverable, making them ideal for urban and suburban transit. These buses are best suited for city centers, residential areas, and routes with small streets and sharp turns. They have a smaller footprint and are more maneuverable, making them ideal for traversing tight city streets and hectic traffic. Many public transportation agencies employ 40-foot hydrogen buses as the typical size. They establish a compromise between capacity and mobility, making them adaptable to various urban and suburban routes. These buses have a modest passenger capacity and are often utilized for ordinary city bus routes and interstate travel.

Recent Developments

• July 2023- Tata Motors introduced a high-performance, technologically sophisticated line of generators.
• July 2023- Hyundai Motor Company unveiled its completely redesigned, all-new Santa Fe today. The fifth-generation midsize SUV maintains its characteristic nature-meets-city charm while incorporating important upgrades molded by big data and centered on the most recent outdoor lifestyle trends.
• June 2023- Ballard and First Mode agreed to acquire 60 more hydrogen fuel cell modules for zero-emission mining vehicles.
• June 2023- Nova Bus altered its business strategy and discontinued bus manufacture in the United States.